Published on: 2026-09-30
Source: United Nations – United Nations –
An important disclaimer is at the bottom of this article.
September 29, 2026 Economic Development
Electricity demand could double by 2050. However, in the European region and North America, half of the electricity is still generated from fossil fuels, and the annual emissions of this industry exceed four gigatons of CO₂.
At the same time, the reliability of power systems no longer seems to be something taken for granted. Large-scale power outages in Central Asia last summer and on the Iberian Peninsula in spring 2025 showed how “fragile” grids become when the share of renewable sources grows and traditional thermal plants are retired. Services that were previously assured automatically now require planning and targeted investments.
Given the rapidly changing situation, the United Nations Economic Commission for Europe (UNECE) has released a new Protocol on the comprehensive assessment of the cost and value of sustainable and carbon-neutral electric power systems – a document that offers countries a fundamentally different approach to planning the energy transition.
Why old methods no longer work
Today, key decisions in energy are often made based on the indicators of individual power plants—primarily considering the cost of generated electricity. However, this approach does not take into account the expenses for maintaining backup capacities, energy storage, and grid development, as well as environmental and social effects. A system that appears cheap on paper may prove to be vulnerable, costly, and environmentally unsustainable in reality.
The New Protocol proposes to go beyond cost and consider the benefits the system brings to society, as well as the losses that occur when it fails. One hour of “blackout” can cost the economy hundreds of millions of dollars. In traditional models, these risks remain unaccounted for.
New planning logic
At the core of the new approach lies the combination of two key categories.
The cost of the system includes capital and operating expenses for its creation and operation.
The value of the system is determined by the volume of prevented economic losses and gained benefits: from avoiding outages and price shocks to reducing health harm and climate risks.
The combination of these two factors indicates the level of resilience of the electric power system. This approach makes external effects visible already at the planning stage.
A tool for decision makers
The protocol is developed as a practical guide for ministries of energy, regulators, transmission and distribution system operators, regional authorities, investors, and financial institutions. It helps to incorporate systemic factors into national strategies, long-term plans, and investment decisions that shape infrastructure development for decades ahead.
The document is the result of collaboration among four expert groups of the UNECE – on clean power systems, renewable energy, gas, and energy efficiency – and a wide range of stakeholders.
Four steps to a sustainable energy system
The protocol proposes using an algorithm that enables countries to assess their capabilities and risks, compare development options, and choose the best path.
Step 1: diagnosis
Defining the real problem that needs to be solved. National consultations and a set of diagnostic indicators help identify the weaknesses of the system.
Step 2: Prioritization
The country establishes a hierarchy of three pillars – security, affordability, environmental friendliness – based on its resources, import dependence, economic structure, climate risks, and political support.
Step 3: assessment
Comparison of various resources on a unified basis using integrated modeling. The system is evaluated simultaneously by cost and value, in accordance with national priorities.
Step 4: stress testing
Checking how each scenario withstands unexpected events: climate disasters, price shocks, technological failures. Risks become visible before making a decision, not after a crisis.
Transition to the power industry of the future
The energy transition is not only about replacing technologies, but also about changing the very logic of planning. The new UNECE Protocol offers countries a tool that allows them to see the system as a whole, consider hidden risks, and make decisions capable of withstanding future tests.
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